Shareholder Disappointed but not Surprised by Board’s Entrenchment and Disingenuous Approach to Negotiations
NEW YORK, Oct. 12, 2018 (GLOBE NEWSWIRE) -- Paulson & Co. Inc. (“Paulson”), one of the largest, long-term shareholders in Detour Gold Corporation (TSX: DGC) ("Detour Gold" or the "Company”), initiated a dialogue with the Company this week in an attempt to reach a negotiated settlement with Detour Gold. The two settlement alternatives it provided to the Company this morning were rejected out-of-hand by its entrenched board of directors, via the media rather than to Paulson directly.
The correspondence with Detour Gold leading up to this morning’s proposals are available for shareholders to review at www.shareholdersfordetour.com.
When Paulson and Detour Gold Director Alex Morrison spoke by phone earlier today, Paulson offered two settlement alternatives representing significant compromises. The alternatives called for the specific removal of certain of the longest-standing board members to be replaced by a different combination of directors from the Paulson slate. Despite promising to consider the proposals, Detour Gold rejected both alternatives almost immediately. By preparing a press release and email campaign to shareholders to run right after the first and only phone call to discuss a settlement, the Board has shown more interest in gamesmanship than reaching an agreement in the best interests of the Company.
The Board cannot continue to ignore this clear message - shareholders are demanding meaningful change, including by removing the long-standing directors who are directly responsible for the spectacular value destruction at the Company.
Detour Gold’s directors could have done the right thing and ceased wasting the Company's cash in a fight against its shareholders. Instead, they have opted to protect their tenure and delay their ouster at a shareholder vote. The failed negotiations have demonstrated that even with three new directors on Detour Gold’s board, they are still not inclined to act in the best interests of the Company. At a certain point, Paulson hopes that even the most entrenched long-standing and entitled directors consider the damage they are continuing to inflict on the Company and their reputations.
Paulson calls on the Company to commit to a fair shareholder meeting process, immediately establish a record date and file a proxy circular – particularly in light of our concern that the Company may not be complying with the proxy solicitation rules. It is time for shareholders to be given the opportunity to oust this Board in its entirety.
About Paulson & Co. Inc.
Paulson is one of Detour Gold’s largest investors, exercising control or direction over approximately 5.4% of Detour Gold’s shares. Having first invested in the Company nine years ago, Paulson previously provided C$280 million in direct equity and US$250 million in convertible notes to finance its mine completion. Paulson, along with several other major shareholders in the Company, has grown increasingly frustrated by the Company’s inability to appropriately manage shareholders’ assets, having destroyed billions of dollars of value in the process.
Paulson, founded in 1994, is an investment management firm with offices located in New York, London and Dublin.
Contact Details
Investors:
MacKenzie Partners, Inc.
Dan Burch & Jeanne Carr
800-322-2885
212-929-5500
Email: Detourproxy@mackenziepartners.com
Media:
| Longview Communications & Public Affairs | |
| Peter Block | Joel Shaffer |
| 416-649-8008 | 416-649-8006 |